Frequent-flier miles not always transferable upon death

• Use them up. As a preventive measure, use your points as you accumulate them. Redeem them for yourself or as gifts to others.

• Leave logins. Often, you can sidestep the hassle of transferring rewards to heirs if you leave behind the online account login information, such as a user name or account number and the associated password. Also, note your wishes about who should get the value of the accounts.

An executor of an estate can simply log on and use the stored value or, in some cases, cash it out. For example, you might be able to use the deceased person’s miles to book an airline ticket in another person’s name or use accumulated credit card rewards to buy retail gift cards to drain the account. Loyalty programs aren’t going to know the person died unless you tell them.

“In some regards, that’s the path of least resistance from a consumer perspective,” Berry said.

• Try a transfer. If you must transfer rewards and the account has worthwhile value, attempt a transfer even if the company’s policy forbids it. Colloquy found that company policies are inconsistently applied, so it’s worth a try.

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Do your frequent-flier miles expire when you do?

It's a simple question that today has a complicated answer.

And it has become more relevant as larger portions of Americans' assets move from the material world to the digital realm — and as they invest time and effort into loyalty programs that have an estimated $50 billion of accumulated value.

Individuals could rack up thousands of dollars' worth of rewards. Yet policies are varied and inconsistent for bequeathing airline miles and other loyalty rewards to a beneficiary, according to a recent study, “Inherit the Windfall” by Colloquy, the research group for loyalty program provider LoyaltyOne.

“There are still a number of programs that haven't established explicit policies,” said Colloquy Research Director Jeff Berry, author of the report. “Our research was frustrating at times because we couldn't get an answer, or called a couple times and got different answers.”

Some programs allow the transfer of accumulated points, while others explicitly do not. Some charge a fee, while others waive fees partially or entirely, Colloquy found. Some limit to whom a program member can bequeath rewards. Some allow points to be redeemed for a certain time when a person dies, but not the outright transfer of them.

Some policies are clear and published online; others are vague, unpublished or inconsistently applied. Worse, some phone customer representatives were ill-informed, providing answers that contradict written policies, Colloquy found.

“People definitely need a wake-up call on this,” said Brian Kelly, founder of ThePointsGuy.com, a website that advises people on how to accumulate and use travel points and miles.

Especially with frequent-flier programs, accumulated rewards can reach into the tens of thousands of dollars. At minimum, miles are worth 1 cent each, but they can be worth much more. For example, 100,000 miles might buy you a business-class ticket to Europe worth $5,000.

“It's a subject no one wants to talk about, but if you already lost somebody in your life, don't lose a bunch of money too,” Kelly said.

U.S. airlines are a good example of varied policies.

Frequent-flier miles or points can't be transferred upon death on Delta Air Lines and Southwest Airlines. American Airlines and US Airways, however, allow the free transfer of those rewards when a person dies. United Airlines allows a transfer but charges $150.

Berry said he doesn't object to companies making a business decision to prohibit transfers upon death, but they should be clear and transparent about it.

For example, Southwest Airlines, known for being customer-friendly, does not allow transfers upon death of its Rapid Rewards points. But it is quite clear about it, Berry said. And, according to a Southwest spokesman, it will tell customers that whoever has access to the dead person's account has access to the accumulated points.

US Airways has a clear policy, published online, that says accumulated miles can be transferred to the estate within a year of death. It requires appropriate documentation, such as a death certificate and proof of beneficiary.

Delta changed its policy this year to disallow transfers. A Delta spokesman said that was a trade-off for offering airline miles that do not expire.

United MileagePlus miles are transferable with proper documentation and a flat $150 mileage-transfer fee.

American Airlines allows transfers of AAdvantage miles and sends a packet with an affidavit for the beneficiary to fill out. A signature of the surviving spouse, the executor of the estate or sole heir is required, as is a copy of the death certificate. Transfers are processed within seven business days, the airline said.

Loyalty programs are big business, extending beyond frequent-flier miles to credit card rewards, hotel points and a host of others. Memberships in such programs increased more than 26 percent in the past two years, and all those miles, points and rewards are worth about $50 billion, according to the most recent numbers from Colloquy. The average American is a member of 22 loyalty programs.

From a consumer perspective, the more people invest in an asset, the stronger the sense of ownership they have toward it, Berry said.

“Although it's not technically an asset, it may feel that way, similar to a bank balance,” Berry said.

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